Moving from a fully funded to self-funded health insurance model

There’s no getting around it—navigating the ins and outs of health benefits is a complicated task for business owners. You are not only tasked with determining what type of health insurance plans to offer your employees—you also have to figure out the best funding strategy for your business.

There are many potential benefits to moving from a fully funded or traditional health insurance plan to a self-funded plan. In addition to enhanced cash flow, immediate savings can be realized by avoiding taxes and profit margins built into your premiums under a traditional fully-insured arrangement. Plan flexibility, customization, and utilization reporting are also greatly enhanced.

The pricing model is different for both plans, but you can remember them easily by comparing each funding option to some common utility bills!

In this blog post, we’ll cover the basics of fully funded and self-funded insurance models to help you determine which strategy is best for your business. We’ll also highlight the main difference between paying a fixed premium under a fully funded plan and the more flexible pricing of a self-funded plan using everyday utility bills.


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